• EUR/AUD rally extended towards 1.6780 on Friday as Australian dollar was weighed down by by iron-ore , equity weakness and soured risk.
• Investors are bracing for a big week ahead as the European Central Bank holds a monetary policy meeting.
• A rally towards is 1.6850 possible if EUR/AUD bulls overcome resistance at 23.6%fib.
• From a technical viewpoint, RSI is strongly bullish at 62, daily momentum studies, 5, 10 and 21 daily MAs all climb.
• Immediate resistance is located at 1.6800 (23.6%fib), any close above will push the pair towards 1.68700 (Sep 7th high).
• Immediate support is seen at 1.6698 (38.2%fb)and break below could take the pair towards 1.6677(5DMA).
Recommendation: Good to buy on dips around 1.6770, with stop loss of 1.6700 and target price of 1.6850
